Neighbors for Rational Development v. Norton, 02-2085.

Decision Date04 August 2004
Docket NumberNo. 02-2085.,02-2085.
Citation379 F.3d 956
PartiesNEIGHBORS FOR RATIONAL DEVELOPMENT, INC., Plaintiff-Appellant, v. Gail NORTON, Secretary of the Interior; Neal A. McCaleb, Assistant Secretary of Indian Affairs; Robert Baracker, Area Director, Albuquerque Area Office, Bureau of Indian Affairs, Defendants-Appellees.
CourtU.S. Court of Appeals — Tenth Circuit

Appeal from the United States District Court for the District of New Mexico, John E. Conway, J.

COPYRIGHT MATERIAL OMITTED

John W. Utton of Sheehan, Sheehan & Stelzner, P.A., and J. Brian Smith of J. Brian Smith Law Firm, LLC, Albuquerque, NM, for Plaintiff-Appellant.

Todd S. Aagaard (Thomas L. Sansonetti, Assistant Attorney General; E. Ann Peterson, Department of Justice, Washington, DC; Mary Anne Kenworthy, Department of the Interior, Washington, DC; Dori Richards, Department of the Interior, Albuquerque, NM, with him on the brief), Department of Justice, Washington, DC, for Defendants-Appellees.

Before HENRY, Circuit Judge, and McKAY and BRORBY, Senior Circuit Judges.

BRORBY, Circuit Judge.

Neighbors for Rational Development, Inc. ("Neighbors"), appeals a district court order upholding a decision made by the Secretary of the United States Department of Interior ("Secretary") to acquire certain property in trust for the nineteen Indian Pueblos of New Mexico. After reviewing the record and the parties' arguments, we conclude that to the extent Neighbors requested relief would divest the United States of title to the property the Quiet Title Act precludes Neighbors' suit. In addition, we conclude Neighbors' request for an injunction halting development on the property until the Secretary has complied with the National Environmental Policy Act is moot. We therefore dismiss this appeal and remand the case to district court with instructions to vacate its decision and dismiss this action.

BACKGROUND

In 1884, the President of the United States "reserved and set apart" federal property within the City of Albuquerque, New Mexico "for Indian purposes." Executive Order, Oct. 3, 1884 (Pueblo Industrial School Reserve), reprinted in 1 Indian Affairs: Laws and Treaties 877-78 (Charles J. Kappler ed., 2d ed.1904). The land was used for an Indian school. Throughout the next several decades, other parcels of land were added to the Indian School property. The school, however, closed in 1981.

While the property was lying idle, the United States Department of the Interior deeded it to nineteen Pueblos of New Mexico1 ("the Pueblos") as tenants in common. The deed required the Pueblos use the land for "public purposes." In the event the Pueblos failed to satisfy this provision and the failure lasted for at least a year, the Secretary had authority declare a forfeiture. Notwithstanding this provision, the Pueblos continued to let the property lie idle. The Pueblos instead explored options that would allow the United States to hold the property in trust for them.

Finally, the Pueblos requested the Secretary take title to the property and hold it in trust for them. After reviewing the administrative record, the Secretary took the property in trust for the Pueblos.

With the property in trust, the Pueblos made preparations to develop the land into commercial office space. With authorization from the Department of Interior, the Pueblos entered a lease agreement with the Indian Pueblos Development Corporation. See Neighbors for Rational Dev., Inc. v. Albuquerque Area Dir., Bureau of Indian Affairs, 33 I.B.I.A. 36, 36-37 (1998). Neighbors, an organization of landowners, business owners, and residents of land near the Indian School property, appealed the lease approval raising "a veritable laundry list of alleged violations of [the National Environmental Policy Act] and its implementing regulations." Id. at 36 n. 2, 42. The Interior Board of Indian Appeals found Neighbors "failed to show error in [the Bureau of Indian Affair's] approval of the lease between the 19 Pueblos and the [Indian Pueblos Development Corporation]." Id. at 49.

DISTRICT COURT PROCEEDING

After losing its appeal concerning the lease of the Indian School property, Neighbors filed a complaint in the United States District Court for the District of New Mexico, arguing the Secretary improperly "plac[ed] the property in trust without complying with the National Environmental Policy Act." Specifically, Neighbors argued the Secretary should have conducted an environmental assessment under the National Environmental Policy Act because "at the time the property was placed in trust" the Secretary "contemplated a change in land use." The district court initially dismissed the complaint for lack of standing.

Unsatisfied with this result, Neighbors asked the district court to reconsider its order, or alternatively, for leave to amend its complaint. The district court reaffirmed its ruling, but granted Neighbors permission to amend its complaint to allege the Secretary had violated regulations specifically governing the acquisition of land in trust for tribes. See 25 C.F.R. § 151.10 (1993). Neighbors then amended its complaint alleging the Secretary

unlawfully did not consider and evaluate: (1) the need of the tribe for the trust conversion; (2) the purpose for which the land would be used; (3) the impact on the state and its subdivisions on removing the land from the tax rolls; (4) jurisdictional problems and potential conflicts of land use that might arise; and (5) whether [the Bureau of Indian Affairs] could manage the additional responsibilities; all as required by 25 C.F.R. Part 151 and [Bureau of Indian Affairs] Guidelines.

Neighbors' amended complaint also alleged the Secretary "failed to comply with the National Environmental Policy Act and its implementing regulations and guidelines ... by failing to perform an Environmental Assessment or Environmental Impact Statement prior to accepting the ... property in trust for the Pueblos." The Secretary asked the district court to strike this portion of the complaint. Noting its prior order holding Neighbors did not have standing to bring environmental claims, the district court granted the motion and ordered the National Environmental Policy Act claim stricken from the complaint.

The district court then turned to the merits of Neighbors' contention the Secretary did not follow the trust acquisition regulations. After briefing by the parties, the district court concluded the Secretary's decision to accept the property in trust was arbitrary and capricious because it failed to adequately consider factors listed in the trust acquisition regulations. The district court therefore remanded the case to the Secretary.

The ongoing district court saga did not, however, end there. This time it was the Secretary who was displeased with the decision. The Secretary asked the district court to alter or amend the decision, arguing, among other things, it should be allowed to supplement the record. Although the court refused to address a new argument the Secretary included in the motion, the district court did amend its previous order allowing the Secretary "to supplement the administrative record with additional affidavits or testimony as may be necessary to explain the agency's decision."

Seizing the opportunity, the Secretary submitted declarations from two Bureau of Indian Affairs employees who had reviewed various aspects of the proposed land acquisition and prepared recommendations and summaries for the Secretary. At this point, the district court decided sua sponte to reconsider its finding that the Secretary's decision to accept the property in trust was arbitrary and capricious and ordered a hearing. Ultimately, the district court vacated, in part, its earlier order and reinstated the Secretary's decision to accept the property. The court determined the Secretary had not acted arbitrarily and capriciously in relying on contemporaneous explanations of a Bureau of Indian Affairs area director.

DISCUSSION

Neighbors then filed this appeal. Neighbors argues "[t]he Secretary's decision to acquire the [Indian School] property in trust for the Pueblos was arbitrary, capricious, an abuse of discretion, and otherwise not in accordance with law" because the Secretary (1) failed to comply with the National Environmental Policy Act, and (2) failed to consider "the regulatory factors for trust acquisitions" in 25 C.F.R. § 151.10.

The Secretary argues "Neighbors' claim to set aside the Department of the Interior's trust acquisition of the Albuquerque Indian School property challenges the United States' title to the property and is therefore precluded by the Quiet Title Act." The Secretary further maintains Neighbors lacks standing to bring its claims, and, in any event, did not violate the National Environmental Policy Act or the trust acquisition regulations. Finally, the Secretary urges us to conclude Neighbors' National Environmental Policy Act claim is moot because, since the trust acquisition, the Secretary completed an Environmental Assessment for the lease on the Indian School property.

Because the Secretary's Quiet Title Act argument involves subject matter jurisdiction, we begin there. We review questions involving subject matter jurisdiction de novo. U.S. West, Inc. v. Tristani, 182 F.3d 1202, 1206 (10th Cir.1999), cert. denied, 528 U.S. 1106, 120 S.Ct. 845, 145 L.Ed.2d 713 (2000). Neighbors asserts the district court had jurisdiction under 28 U.S.C. §§ 1331, 2201, and 2202. The general federal question statute, 28 U.S.C. § 1331, grants the district courts "original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States," but "does not waive the government's sovereign immunity." Eagle-Picher Indus., Inc. v. United States, 901 F.2d 1530, 1532 (10th Cir.1990). Consequently, district court jurisdiction cannot be based on § 1331 unless some other statute waives sovereign immunity. See New Mexico v. Regan, 745 F.2d 1318,...

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